Best Buy Marketing Strategies in a Difficult Retail Environment

1275 Words Jun 9th, 2012 6 Pages
Best Buy Marketing Strategies in a
Difficult Retail Environment
Jayne Diaz
BUS 620: Managerial Marketing
Professor David Kalicharan
January30, 2012

Best Buy Marketing Strategies in a Difficult Retail Environment

Best Buy was once the “go-to” store for electronics. This organization expanded from the U.S. market to a multi national retailer in 2001. Best Buy has squashed its competition for over four decades. Circuit City eventually declared bankruptcy, while Fry’s Electronics and Hhgregg are minor players in the electronic retail market. With the advent of e-commerce, as opposed to brick and mortar competition, Best Buy has been struggling to compete in a new marketplace. This paper will discuss the three different
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“Best Buy grew rapidly from sales of $240 million in 1987 to $7.2 billion in 1996” (Tatge, 2004, para. 11). Barron’s online magazine (2012) reported that Best Buy had $50.27 billion in sales in 2011.

Improvements to the Strategy

Best Buy jumped on the band wagon with their online marketing, expanding their demographic segmentation. Prior to the holiday season, Best Buy “beefed up its online campaign to fight off intense competition from online retailers and discount stores. And the holiday season is crucial for retailers like Best Buy because it can make up to 40 percent of annual sales” (Anderson, 2011, para. 4). Unfortunately, they were unable to execute the confirmed orders due to lack of products in the warehouse and told the customers who had paid that they were no longer able to follow through with the order. The company had their chance to create online sales, but the online experience for consumers needs to be improved if they want to keep their name in the electronics market. By providing free shipping and price matching they can improve their ability to compete against other online merchants.

Conclusion

“There will always be people who won't buy televisions online, and Best Buy may be able to whittle its stores and its inventory to match the high-margin

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